Francis Pileggi recently blogged about the Chancery Court’s decision in IAC Search v. Conversant – where the Court held that a disclaimer of extra-contractual representations in a purchase agreement was sufficient to preclude a fraud claim. This excerpt summarizes the reasons for the Court’s dismissal of the case:
Resolution of the claim turned on the application of Delaware case law that addresses anti-reliance clauses in purchase agreements. A key fact that the fraud claim was based on was the accuracy of information provided during due diligence that the parties chose not to incorporate into an express representation or warranty in the agreement.
A specific provision in the agreement provided that the seller disclaimed making any extra-contractual representations. Likewise, the buyer acknowledged that the seller did not make any representations that were not expressly included in the agreement. In addition, the parties included in their agreement a standard integration clause that defined the universe of writings that made up the parties’ agreement.
– John Jenkins